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UPDATE 1-Japan's Aeon posts weak annual profit, but sees improvement this year
April 12, 2017 / 7:05 AM / 8 months ago

UPDATE 1-Japan's Aeon posts weak annual profit, but sees improvement this year

* Sees oper profit 195 bln yen for current year, below consensus

* Oper profit for year ended Feb misses Aeon’s own estimate (Adds estimate, share movement, details, background)

TOKYO, April 12 (Reuters) - Aeon Co posted a lower-than-expected annual operating profit, but the top Japanese retailer expects results to improve this year as it takes measures to improve profitability and shore up its struggling general merchandise stores.

Retailers have been rolling out measures such as price cuts to attract buyers as domestic consumption remains weak, with Japan mired in deflation for nearly two decades and households sitting on a pile of cash amid uncertainty over the outlook.

For the year ended Feb. 28, Aeon reported an operating profit of 184.7 billion yen ($1.7 billion), up 4 percent from a year ago but short of the company’s estimate of 190 billion yen.

It was below an average estimate of about 186 billion yen from nine analysts surveyed by Thomson Reuters.

The company’s forecast for an operating profit of 195 billion yen for the current year is also below a consensus estimate of about 199.7 billion yen.

On Tuesday, Aeon announced the latest in a series of price cuts for hundreds of household items, from milk to pet food, as it tries to lure Japan’s thrifty shoppers.

Convenience store operator Seven & i Holdings Co and Seiyu, a retailer under the arm of U.S. retailer Walmart , have also announced similar price reductions.

Aeon shares closed up 0.1 percent ahead of the results, versus a 1 percent fall in the broad Topix index. (Reporting by Sam Nussey; Editing by Himani Sarkar)

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